What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-10-31 compared with 2025-08-11 · 246 added, 167 removed, 616 unchanged (40% of the section changed)

4 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(in thousands, except per share data)

6 unchanged sentences

Total operating costs and expenses

Operating (loss) income

Operating income

Interest expense, net

1 unchanged sentence

Other expense, net

Loss from continuing operations before income taxes

Income tax benefit

Loss from continuing operations, net of tax

(Loss) income from continuing operations before income taxes

Income tax provision (benefit)

(Loss) income from continuing operations, net of tax

Loss from discontinued operations, net of tax

( 1,044,316 )

Basic loss per common share:

Loss from continuing operations

Loss from discontinued operations

(Loss) income from continuing operations, net of tax

Loss from discontinued operations, net of tax

Diluted loss per common share:

Loss from continuing operations

Loss from discontinued operations

(Loss) income from continuing operations, net of tax

Loss from discontinued operations, net of tax

See accompanying notes to unaudited condensed consolidated financial statements.

1 unchanged sentence

and Subsidiaries

Condensed Consolidated Statements of Comprehensive Loss

Condensed Consolidated Statements of Comprehensive (Loss) Income

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(in thousands)

( 1,044,316 )

Other comprehensive income (loss), net of tax:

2 unchanged sentences

Change in gains and losses on derivative instruments

Total other comprehensive income (loss), net of tax

Comprehensive loss

Total other comprehensive (loss) income, net of tax

Comprehensive (loss) income

( 1,025,385 )

See accompanying notes to unaudited condensed consolidated financial statements.

2 unchanged sentences

Condensed Consolidated Balance Sheets

September 30,

(in thousands, except per share data)

30 unchanged sentences

(Accumulated deficit) retained earnings

( 1,022,161 )

Accumulated other comprehensive loss

5 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Six Months Ended June 30,

Nine Months Ended September 30,

(in thousands)

Operating activities:

Adjustments to reconcile net loss to cash provided by operating activities:

( 1,044,316 )

Adjustments to reconcile net loss to cash (used for) provided by operating activities:

Depreciation and amortization

2 unchanged sentences

Share-based compensation expense

Loss on extinguishment of debt

Deferred income tax benefit

5 unchanged sentences

Net change in other assets and liabilities

Cash provided by operating activities

Cash (used for) provided by operating activities

Investing activities:

6 unchanged sentences

Repayments under amended Receivables Financing Agreement

( 1,286,400 )

Borrowings under Revolving Credit Facility

5 unchanged sentences

Effect of exchange rate changes on cash, cash equivalents and restricted cash

Net increase in cash, cash equivalents and restricted cash

Net decrease in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash at beginning of period

22 unchanged sentences

Balance, June 30, 2025

Other comprehensive loss

Share-based compensation expense, exercises and other

Balance, September 30, 2025

( 1,022,161 )

Balance, December 31, 2023

5 unchanged sentences

Balance, June 30, 2024

Other comprehensive income

Share-based compensation expense, exercises and other

Balance, September 30, 2024

See accompanying notes to unaudited condensed consolidated financial statements.

6 unchanged sentences

The unaudited condensed consolidated financial statements include the accounts of Owens & Minor, Inc.

and the subsidiaries it controls (the Company, we, us, or our) and contain all adjustments necessary to conform with U.S.

generally accepted accounting principles (GAAP).

and the subsidiaries it controls (the Company, we, us, or our) and contain all adjustments necessary to conform with United States (U.S.) generally accepted accounting principles (GAAP).

All significant intercompany accounts and transactions have been eliminated.

The results of operations for interim periods are not necessarily indicative of the results expected for the full year.

In connection with the contemplated sale of our Products & Healthcare Services (P&HS) segment as detailed in the discontinued operations and assets held-for-sale section below, we determined that our continuing operations’ business activities comprise a single operating and reportable segment.

In connection with the anticipated sale of our Products & Healthcare Services (P&HS) segment as detailed in the discontinued operations and assets held-for-sale section below, we determined that our continuing operations’ business activities comprise a single operating and reporting segment.

This determination is in accordance with ASC No.

6 unchanged sentences

Accordingly, the error was corrected through beginning retained earnings as of the earliest balance sheet date presented.

The cumulative impact of the error correction on our r etained earnings and total equity as of the earliest balance sheet date presented, was an increase of $ 21 million.

The cumulative impact of the error correction on our retained earnings and total equity as of the earliest balance sheet date presented, was an increase of $ 21 million.

The error also resulted in a cumulative $ 23 million reduction to accounts payable, a $ 1.6 million increase to other current liabilities, and a $ 0.5 million increase to other liabilities as of December 31, 2023.

2 unchanged sentences

Discontinued Operations and Assets Held-for-Sale.

On February 28, 2025, we announced that we are actively engaged in discussions regarding the contemplated sale of our P&HS segment.

We are in the final stages of our process for the divestiture and have concluded the P&HS segment has met the accounting requirements to be classified as discontinued operations and held for sale as of June 30, 2025.

During this process we remain committed to serving our P&HS segment customers.

On February 28, 2025, we announced that we were actively engaged in discussions regarding the anticipated sale of our P&HS segment.

On October 7, 2025, we, entered into an Equity Purchase Agreement, (the Purchase Agreement) by and among the Company, Dominion Healthcare Acquisition Corporation, a Delaware corporation (the Purchaser), and Dominion Healthcare Holdings, L.P., a Delaware limited partnership (Purchaser Parent) to sell the P&HS segment, for an aggregate of $ 375 million in cash, subject to certain adjustments for cash, indebtedness, net working capital and transaction expenses.

We will retain a 5 % equity interest in the P&HS segment.

The Purchaser will be required to pay us a termination fee under certain specified circumstances of $ 9.4 million or $ 19 million depending on the stage of regulatory approval and other criteria.

The sale is subject to customary closing conditions, including the Hart Scott Rodino Act and other regulatory approvals, and is expected to close in the first quarter of 2026.

The P&HS segment was initially classified as discontinued operations and assets held for sale as of June 30, 2025.

In accordance with GAAP, the financial position and results of operations of the P&HS segment are presented as discontinued operations and, as such, have been excluded from continuing operations for all periods presented.

4 unchanged sentences

The preparation of consolidated financial statements in conformity with GAAP requires us to make assumptions and estimates that affect reported amounts and related disclosures.

Significant estimates are used for, but are not limited to, variable consideration, depreciation and amortization, goodwill valuation, valuation of intangible assets and other long-lived assets, estimated fair values of the net assets acquired in business combinations, self-insurance liabilities, tax liabilities, defined benefit obligations, share-based compensation and other contingencies.

Significant estimates are used for,

but are not limited to, variable consideration, depreciation and amortization, goodwill valuation, valuation of intangible assets and other long-lived assets, estimated fair values of the net assets acquired in business combinations, self-insurance liabilities, tax liabilities, defined benefit obligations, share-based compensation and other contingencies.

Actual results may differ from these estimates.

2 unchanged sentences

Cash and cash equivalents are stated at cost.

Nearly all of our cash and cash equivalents are held in cash depository accounts in major banks in the United States (U.S.).

Cash that has

restrictions on its availability to us would be classified as restricted cash.

There was no restricted cash as of June 30, 2025 and December 31, 2024.

Nearly all of our cash and cash equivalents are held in cash depository accounts in major banks in the U.S.

Cash that has restrictions on its availability to us would be classified as restricted cash.

There was no restricted cash as of September 30, 2025 and December 31, 2024.

The following table provides a reconciliation of cash and cash equivalents reported within the accompanying condensed consolidated balance sheets that sum to the total of those same amounts presented in the accompanying condensed consolidated statements of cash flows.

June 30, 2025

September 30, 2025

December 31, 2024

9 unchanged sentences

Such adjustments are typically identified and recorded at the point of cash application, claim amount or account review.

Included in accounts receivable were earned but unbilled receivables of $ 34 million as of June 30, 2025 and $ 30 million as of December 31, 2024.

Included in accounts receivable were earned but unbilled receivables of $ 33 million as of September 30, 2025 and $ 30 million as of December 31, 2024.

Delays, ranging from a single day to several weeks, between the date of service and billing can occur due to delays in obtaining certain required payor-specific documentation from internal and external sources.

11 unchanged sentences

In general, the estimated useful lives for computing depreciation are one to 10 years for patient service equipment, and up to 15 years for other fixed assets.

Straight-line and accelerated methods of depreciation are used for income tax purposes.

Straight-line and

accelerated methods of depreciation are used for income tax purposes.

Normal maintenance and repairs are expensed as incurred, and renovations and betterments are capitalized.

1 unchanged sentence

We account for all of our lease arrangements, including for real estate, trucks, and patient service equipment, as operating leases.

We enter into non-cancelable agreements to lease most of our office, branch and warehouse facilities with remaining terms generally ranging from one to seven years .

We enter into non-cancelable agreements to lease most of our office, branch and warehouse facilities with remaining terms generally ranging from one to six years .

Certain building leases include renewal options which the exercise of is at our sole discretion.

We generally do not include options to renew (or

terminate) in our lease term, as part of our right-of-use assets and lease liabilities, as we generally do not have leases for which we believe we are reasonably certain to exercise those options.

We generally do not include options to renew (or terminate) in our lease term, as part of our right-of-use assets and lease liabilities, as we generally do not have leases for which we believe we are reasonably certain to exercise those options.

Leases with a term of 12 months or less are not recorded on the condensed consolidated balance sheets;

26 unchanged sentences

Capitalized computer software costs are included in other assets, net, in the condensed consolidated balance sheets.

Unamortized software at June 30, 2025 and December 31, 2024 was $ 17 million and $ 26 million.

Unamortized software at September 30, 2025 and December 31, 2024 was $ 15 million and $ 26 million.

Long-Lived Asset Impairment Evaluation.

7 unchanged sentences

If the underlying facts and circumstances of existing claims change or the historical trends are not indicative of future trends, then we may be required to adjust the liability and related expense accordingly.

Self-insurance liabilities are included in other current liabilities and other liabilities in the condensed consolidated balance sheets and were $ 27 million at June 30, 2025 and December 31, 2024.

Self-insurance liabilities are included in other current liabilities and other liabilities in the condensed consolidated balance sheets and were $ 27 million at September 30, 2025 and December 31, 2024.

Revenue Recognition.

2 unchanged sentences

Revenue generated from equipment that we rent to customers is primarily recognized as earned on a straight-line basis over the non-cancellable rental period, typically one month, and commences on delivery of the equipment to the customers.

Fee-for-service arrangement revenues are recorded only to the extent it is probable that a significant reversal will not occur in the future as amounts may include implicit price concessions under reimbursement arrangements with third-party payors, including private insurers, prepaid health plans, Medicare, Medicaid and customers.

Fee-for-service arrangement revenues are recorded only to the extent it is probable that a significant reversal will not occur in the future as amounts may include implicit price concessions under reimbursement arrangements with third-party payors, including private insurers under both commercial and Medicare Advantage plans, prepaid health plans, Medicare, Medicaid and customers.

Revenue is recognized under a portfolio approach, as we expect that this approach would not differ materially from considering each contract or performance obligation separately.

1 unchanged sentence

Payment terms and conditions vary by contract.

Sales of equipment and supplies inclusive of amounts recognized under capitation arrangements for the three and six months ended June 30, 2025 were $ 511 million and $ 1.0 billion and $ 491 million and $ 960 million for the three and six months ended June 30, 2024.

Rental revenues inclusive of amounts recognized under capitation arrangements for the three and six months ended June 30, 2025 were $ 171 million and $ 341 million and $ 170 million and $ 338 million for the three and six months ended June 30, 2024.

Sales of equipment and supplies inclusive of amounts recognized under capitation arrangements for the three and nine months ended September 30, 2025 were $ 528 million and $ 1.5 billion and $ 517 million and $ 1.5 billion for the three and nine months ended September 30, 2024.

Rental revenues inclusive of amounts recognized under capitation arrangements for the three and nine months ended September 30, 2025 were $ 169 million and $ 510 million and $ 170 million and $ 508 million for the three and nine months ended September 30, 2024.

Certain revenues are recognized under arrangements with third-party payors for which we stand ready to provide all necessary healthcare services to members for the period of the stand ready obligation which generally extends beyond one year.

3 unchanged sentences

Capitation payments are typically received in the month members are entitled to healthcare services.

Revenue for these agreements amounted to $ 61 million and $ 121 million for the three and six months ended June 30, 2025 and $ 59 million and $ 119 million for the three and six months ended June 30, 2024.

Revenue for these agreements amounted to $ 61 million and $ 182 million for the three and nine months ended September 30, 2025 and $ 60 million and $ 178 million for the three and nine months ended September 30, 2024.

The following table summarizes net revenue by product category:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Sleep therapy

2 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Commercial payors (1)

(1) Includes revenue from Medicare Advantage Payors of approximately $ 178 million and $ 172 million for the three months ended June 30, 2025 and 2024 and approximately $ 349 million and $ 337 million for the six months ended June 30, 2025 and 2024.

(1) Commercial payors includes revenue from Medicare Advantage plans.

Cost of Net Revenue .

Cost of net revenue includes the cost of products sold, patient service equipment depreciation expense, and other costs which are primarily personnel costs related to the set-up and utilization of equipment.

Cost of product sold includes non-cash expenses primarily for equipment converted from rental to sales in the amount of $ 14 million and $ 26 million for the three and six months ended June 30, 2025 and $ 5.2 million and $ 15 million for the three and six months ended June 30, 2024.

Cost of product sold includes non-cash expenses primarily for equipment converted from rental to sales in the amount of $ 11 million and $ 35 million for the three and nine months ended September 30, 2025 and $ 7.9 million and $ 23 million for the three and nine months ended September 30, 2024.

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Cost of product sold

5 unchanged sentences

Shipping and handling costs are included in SG&A expenses in the condensed consolidated statements of operations and include costs to store, move, and prepare products for shipment, as well as costs to deliver products to customers.

Shipping and handling costs totaled $ 72 million and $ 139 million for the three and six months ended June 30, 2025 and $ 68 million and $ 137 million for the three and six months ended June 30, 2024.

Shipping and handling costs totaled $ 74 million and $ 213 million for the three and nine months ended September 30, 2025 and $ 68 million and $ 205 million for the three and nine months ended September 30, 2024.

Share-Based Compensation.

3 unchanged sentences

We account for income taxes under the asset and liability method.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of exiting assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

7 unchanged sentences

The assumptions used are in accordance with a three-tier hierarchy, defined by GAAP, that draws a distinction between market participant assumptions based on (i) observable inputs such as quoted prices in active markets (Level 1), (ii) inputs other than quoted prices in active markets that are observable either directly or indirectly (Level 2) and (iii) unobservable inputs that require the use of present value and other valuation techniques in the determination of fair value (Level 3).

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, and accrued payroll and related liabilities reported in the condensed consolidated balance sheets approximate fair value due to the short-term

nature of these instruments.

The estimated fair value of our reporting unit determined during a quantitative review of goodwill utilizes unobservable inputs (Level 3).

The fair value of debt is estimated based on quoted market prices or dealer quotes for the identical liability when traded as an asset in an active market (Level 1) or, if quoted market prices or dealer quotes are not available, on the borrowing rates currently available for loans with similar terms, credit ratings, and average remaining maturities (Level 2).

The estimated fair value of our reporting unit determined during a quantitative review of goodwill utilizes unobservable inputs (Level 3).The fair value of debt is estimated based on quoted market prices or dealer quotes for the identical liability when traded as an asset in an active market (Level 1) or, if quoted market prices or dealer quotes are not available, on the borrowing rates currently available for loans with similar terms, credit ratings, and average remaining maturities (Level 2).

See Note 8 for the fair value of debt.

8 unchanged sentences

(Rotech), which consisted primarily of legal and professional fees.

For the three and six months ended June 30, 2025, we incurred $ 6.4 million and $ 22 million of acquisition-related costs.

Acquisition-related charges were $ 3.7 million for the three and six months ended June 30, 2024 consisting of costs related to the terminated Rotech transaction.

For the nine months ended September 30, 2025, we incurred $ 22 million of acquisition-related costs.

For the three and nine months ended September 30, 2024, we incurred $ 6.5 million and $ 10 million of acquisition-related costs related to the expected acquisition of Rotech Healthcare Holdings Inc.

(Rotech), which consisted primarily of legal and professional fees.

Acquisition-related charges and intangible amortization also include amortization of intangible assets established during acquisition method of accounting for business combinations.

4 unchanged sentences

(Merger Sub) mutually agreed to terminate the Merger Agreement and entered into a mutual termination agreement (the Termination Agreement).

In accordance with the terms of the Termination Agreement, we incurred and made a cash payment to Rotech of $ 80 million during the three and six months ended June 30, 2025.

In accordance with the terms of the Termination Agreement, we incurred and made a cash payment to Rotech of $ 80 million during the nine months ended September 30, 2025.

Exit and Realignment Charges, Net.

3 unchanged sentences

Liabilities are established at the cease-use date for remaining contractual obligations discounted using a credit-adjusted risk-free rate of interest.

We evaluate these assumptions quarterly and adjust the liability accordingly.

We evaluate these assumptions quarterly and adjust the liabilities accordingly.

Severance benefits are generally recorded when payment is considered probable and reasonably estimable.

1 unchanged sentence

Note 2—Significant Concentration Risks

During the six months ended June 30, 2025, our two largest commercial payors represented approximately 24 % and 14 % of our net revenue, derived from multiple separately managed contracts.

Revenue reimbursed under arrangements with Medicare and state Medicaid programs was approximately 19 % of our net revenue for the six months ended June 30, 2025.

During the six months ended June 30, 2025, three suppliers each contributed between 10 % and 25 % of our patient service equipment and supplies purchases collectively accounting for approximately 46 % of our total purchases.

During the nine months ended September 30, 2025, our two largest commercial payors represented approximately 23 % and 14 % of our net revenue, derived from multiple separately managed contracts.

Revenue reimbursed under arrangements with Medicare and state Medicaid programs was approximately 19 % of our net revenue for the nine months ended September 30, 2025.

The largest commercial payor recently notified us that it intends to terminate certain of our contracts with them.

The terminated agreements reflected $ 242 million or 12 % of our net revenue, including $ 173 million of capitation revenue, which represents nearly all of our capitation revenue, for the nine months ended September 30, 2025.

During the nine months ended September 30, 2025, three suppliers each contributed between 10 % and 25 % of our patient service equipment and supplies purchases collectively accounting for approximately 48 % of our total purchases.

Note 3—Discontinued Operations and Assets Held-for-Sale

On February 28, 2025, we announced that we are actively engaged in discussions regarding the contemplated sale of our P&HS segment.

We are in the final stages of our process for the divestiture and have concluded the P&HS

segment has met the accounting requirements to be classified as discontinued operations and assets held for sale as of June 30, 2025.

During this process we remain committed to serving our P&HS segment customers.

On February 28, 2025, we announced that we were actively engaged in discussions regarding the anticipated sale of our P&HS segment.

On October 7, 2025, we entered into the Purchase Agreement by and among the Company, the Purchaser, and Purchaser Parent to sell the P&HS segment, for an aggregate of $ 375 million in cash, subject to certain adjustments for cash, indebtedness, net working capital and transaction expenses.

We will retain a 5 % equity interest in the P&HS segment.

The Purchaser will be required to pay us a termination fee under certain specified circumstances of $ 9.4 million or $ 19 million depending on the stage of regulatory approval and other criteria.

The sale is subject to customary closing conditions, including the Hart Scott Rodino Act and other regulatory approvals, and is expected to close in the first quarter of 2026.

In accordance with GAAP, the financial position and results of operations of the P&HS segment are presented as discontinued operations and assets held for sale and, as such, have been excluded from continuing operations for all periods presented.

Accordingly, the results of operations from our P&HS segment are reported in the accompanying condensed consolidated statements of operations as “Loss from discontinued operations, net of tax” for the three and six months ended June 30, 2025 and 2024, and the related assets and liabilities are classified as held-for-sale as of June 30, 2025 and December 31, 2024 in the accompanying condensed consolidated balance sheets.

The P&HS segment was initially classified as discontinued operations and assets held for sale as of June 30, 2025.

Accordingly, the results of operations from our P&HS segment are reported in the accompanying condensed consolidated statements of operations as “Loss from discontinued operations, net of tax” for the three and nine months ended September 30, 2025 and 2024 and the related assets and liabilities are classified as held-for-sale as of September 30, 2025 and December 31, 2024 in the accompanying condensed consolidated balance sheets.

We have allocated interest expense, net to discontinued operations as a ratio of net assets and total debt in accordance with ASC 205, Presentation of Financial Statements .

As of June 30, 2025 the remaining P&HS goodwill balance of $ 106 million was fully impaired.

The remaining P&HS goodwill balance of $ 106 million was fully impaired during the second quarter of 2025.

Our sale process provided a basis for the fair value of the P&HS segment, which includes the Global Products reporting unit.

We recognized a loss of $ 649 million in connection with the classification of the related assets and liabilities as held-for-sale, based on the estimated fair value, less costs to sell.

The fair value of the P&HS segment was determined from information received during our sale process.

We recognized a loss of $ 123 million and $ 772 million during the three and nine months ended September 30, 2025 in connection with the classification of the related assets and liabilities as held-for-sale, based on the estimated fair value, less costs to sell.

The fair value of the P&HS segment was determined from information received during our sale process, including the Purchase Agreement.

Subsequent changes in fair value will be recorded within discontinued operations and assets held for sale.

The following table summarizes the financial results of our discontinued operations for the three and six months ended June 30, 2025 and 2024:

The following table summarizes the financial results of our discontinued operations for the three and nine months ended September 30, 2025 and 2024:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Cost of goods sold

5 unchanged sentences

Other operating expense, net

Operating (loss) income

Operating loss

Interest expense, net

3 unchanged sentences

Loss from discontinued operations, net of taxes

The assets and liabilities of the P&HS segment reflected on the condensed consolidated balance sheets at June 30, 2025 and December 31, 2024, are as follows:

The assets and liabilities of the P&HS segment reflected on the condensed consolidated balance sheets at September 30, 2025, and December 31, 2024, are as follows:

September 30,

Assets held for sale - discontinued operations

29 unchanged sentences

Total liabilities held for sale - discontinued operations

Assets and liabilities held for sale as of June 30, 2025 are classified as current since we expect the divestiture to be completed within one year of the balance sheet date.

Assets and liabilities held for sale as of September 30, 2025 are classified as current since we expect the divestiture to be completed within one year of the balance sheet date.

As of December 31, 2024, the assets and liabilities held for sale are classified separately as current or noncurrent because the noncurrent assets and liabilities did not meet the criteria for current classification as of December 31, 2024.

Merchandise inventories include $ 97 million subject to lien with an individual supplier as of June 30, 2025.

Merchandise inventories include $ 110 million subject to lien with an individual supplier as of September 30, 2025.

Receivables Purchase Agreement

4 unchanged sentences

The RPA is separate and distinct from the Receivables Sale Program and the amendment as described below.

As a result of the amendment described below, the RPA was not utilized in the six months ended June 30, 2025.

As a result of the amendment described below, the RPA was not utilized in the nine months ended September 30, 2025.

Proceeds from the sale of accounts receivable are recorded as an increase to cash and cash equivalents and a reduction to current assets of discontinued operations, in the condensed consolidated balance sheets.

1 unchanged sentence

The accounts receivable sold under the RPA were entirely accounts receivable of the P&HS segment.

Total accounts receivable sold under the RPA were $ 573 million and $ 1.1 billion for the three and six months ended June 30, 2024.

During the three and six months ended June 30, 2024, we received net cash proceeds of $ 569 million and $ 1.1 billion from the sale of accounts receivable under the RPA and collected $ 547 million and $ 1.1 billion of the sold accounts receivable.

The losses on sale of accounts receivable, inclusive of professional fees incurred to establish the agreement, recorded in other operating expense, net in the financial results from discontinued operations were $ 3.9 million and $ 7.2 million for the three and six months ended June 30, 2024.

Total accounts receivable sold under the RPA were $ 542 million and $ 1.6 billion for the three and nine months ended September 30, 2024.

During the three and nine months ended September 30, 2024, we received net cash proceeds of $ 538 million and $ 1.6 billion from the sale of accounts receivable under the RPA and collected $ 550 million and $ 1.6 billion of the sold accounts receivable.

The losses on sale of accounts receivable, inclusive of professional fees incurred to establish the agreement, recorded in other operating expense, net in the financial results from discontinued operations were $ 3.6 million and $ 11 million for the three and nine months ended September 30, 2024.

Receivables Sale Program

4 unchanged sentences

however, we do not maintain any beneficial interest in the accounts receivable sold.

Upon the completion of the sale of the P&HS segment the related accounts receivable will no longer be eligible for sale under the Receivables Sale Program as the program will not convey.

Proceeds from the sales of accounts receivable are recorded as an increase to cash and cash equivalents and a reduction to accounts receivable, net of allowances in the consolidated balance sheets.

1 unchanged sentence

The accounts receivable sold under the Receivables Sale Program were primarily accounts receivable of the P&HS segment.

Total accounts receivable sold and net cash proceeds under the Receivables Sale program were $ 496 million and $ 840 million during the three and six months ended June 30, 2025, approximately $ 397 million and $ 672 million of which were accounts receivable of the P&HS segment.

We collected $ 495 million and $ 704 million of the sold accounts receivable for the three and six months ended June 30, 2025, approximately $ 396 million and $ 563 million of which were collections on accounts receivable of the P&HS segment.

The losses on sales of accounts receivable were $ 3.1 million and $ 5.2 million for the three and six months ended June 30, 2025, $ 2.5 million and $ 4.1 million of which relate to losses recorded in other operating expense, net in the financial results from discontinued operations.

As of June 30, 2025 and December 31, 2024, there was a total of $ 200 million and $ 70 million of uncollected accounts receivable sold and removed from our condensed consolidated balance sheets under the Receivables Sale Program, $ 160 million and $ 56 million of which relate to the assets of discontinued operations and assets held for sale.

As of June 30, 2025 the $ 160 million of uncollected accounts receivable related to the assets of discontinued operations and assets held for sale is shown as an intercompany receivable within current assets of discontinued operations and assets held for sale with an equal amount reflected within other current liabilities in the condensed consolidated balance sheet.

The following table provides significant non-cash operating and investing cash flow information for our discontinued operations and assets held for sale:

Six Months Ended

Total accounts receivable sold and net cash proceeds under the Receivables Sale program were $ 466 million and $ 1.3 billion during the three and nine months ended September 30, 2025, approximately $ 373 million and $ 1.0 billion of which were accounts receivable of the P&HS segment.

We collected $ 465 million and $ 1.2 billion of the sold accounts receivable for the three and nine months ended September 30, 2025, approximately $ 372 million and $ 935 million of which were collections on accounts receivable of the P&HS segment.

The losses on sales of accounts receivable were $ 3.0 million and $ 8.2 million for the three and nine months ended September 30, 2025, $ 2.4 million and $ 6.5 million of which relate to losses recorded in other operating expense, net in the financial results from discontinued operations.

As of September 30, 2025 and December 31, 2024, there was a total of $ 200 million and $ 70 million of uncollected accounts receivable sold and removed from our condensed consolidated balance sheets under the Receivables Sale Program, $ 160 million and $ 56 million of which relate to the assets of discontinued operations and assets held for sale.

As of September 30, 2025 the $ 160 million of uncollected accounts receivable related to the assets of discontinued operations and assets held for sale is shown as an intercompany receivable within current assets of discontinued operations and assets held for sale with an equal amount reflected within other current liabilities in the condensed consolidated balance sheet.

The following table provides significant non-cash operating, select operating and significant investing cash flow information for our discontinued operations and assets held for sale:

Three Months Ended

Nine Months Ended

September 30,

Operating Activities:

Loss from discontinued operations, net of tax

Significant non-cash adjustments to reconcile net loss to cash (used for) provided by operating activities:

Goodwill impairment charge

2 unchanged sentences

Share-based compensation

Changes in select operating assets and liabilities:

Accounts receivable, net

Accounts payable

Investing Activities:

3 unchanged sentences

Patient service equipment and other fixed assets, net, consists of the following:

June 30, 2025

September 30, 2025

December 31, 2024

6 unchanged sentences

Note 5—Goodwill and Intangible Assets, Net

At June 30, 2025 and December 31, 2024, we had goodwill of $ 1.2 billion, net of accumulated goodwill impairment of $ 307 million.

Intangible assets, net subject to amortization, which excludes indefinite-lived intangible assets, at June 30, 2025 and December 31, 2024 were as follows:

June 30, 2025

At September 30, 2025 and December 31, 2024, we had goodwill of $ 1.2 billion, net of accumulated goodwill impairment of $ 307 million.

Intangible assets, net subject to amortization, which excludes indefinite-lived intangible assets, at September 30, 2025 and December 31, 2024 were as follows:

September 30, 2025

December 31, 2024

5 unchanged sentences

Weighted average useful life

Amortization expense for intangible assets was $ 7.6 million and $ 15 million for the three and six months ended June 30, 2025 and $ 10 million and $ 24 million for the three and six months ended June 30, 2024.

As of June 30, 2025, based on the current carrying value of intangible assets subject to amortization and expected remaining useful life, estimated amortization expense were as follows:

Amortization expense for intangible assets was $ 29 million and $ 44 million for the three and nine months ended September 30, 2025 and $ 8.4 million and $ 33 million for the three and nine months ended September 30, 2024.

The increase as compared to the prior year was driven by the remaining useful life for an intangible asset being modified

as of June 30, 2025 as a result of a notice of a contract termination with a commercial Payor.

The updated future intangible amortization is reflected in the table below.

As of September 30, 2025, based on the current carrying value of intangible assets subject to amortization and expected remaining useful life, estimated amortization expense were as follows:

2025 (remainder)

Total future amortization

As a result of a notice of a contract termination with a commercial Payor, the remaining useful life for an intangible asset associated with that relationship was modified as of June 30, 2025 and the updated future intangible amortization is reflected in the table above.

Note 6—Leases

The components of lease expense for the three months ended June 30, 2025 and 2024 were as follows:

Three Months Ended June 30,

The components of lease expense for the three and nine months ended September 30, 2025 and 2024 were as follows:

Three Months Ended September 30,

Classification

6 unchanged sentences

Total lease cost

Six Months Ended June 30,

Nine Months Ended September 30,

Classification

7 unchanged sentences

Variable lease cost consists primarily of taxes, insurance, and common area or other maintenance costs for our leased facilities and patient service equipment which are paid as incurred.

Supplemental balance sheet information as of June 30, 2025 and December 31, 2024 was as follows:

As of June 30,

Supplemental balance sheet information as of September 30, 2025 and December 31, 2024 was as follows:

As of September 30,

As of December 31,

7 unchanged sentences

Total operating lease liabilities

Other information related to leases for the six months ended June 30, 2025 and 2024 was as follows:

Six Months Ended June 30,

Other information related to leases for the nine months ended September 30, 2025 and 2024 was as follows:

Nine Months Ended September 30,

Supplemental cash flow information

6 unchanged sentences

Operating leases

Maturities of operating lease liabilities as of June 30, 2025 were as follows:

Maturities of operating lease liabilities as of September 30, 2025 were as follows:

2025 (remainder)

5 unchanged sentences

These costs are not normal, cash operating expenses necessary for the Company to operate its business on an ongoing basis.

Exit and realignment charges, net were $ 2.5 million and $ 16 million for the three and six months ended June 30, 2025 and $ 15 million and $ 24 million for the three and six months ended June 30, 2024.

Exit and realignment charges, net were $ 0.7 million and $ 17 million for the three and nine months ended September 30, 2025 and $ 14 million and $ 37 million for the three and nine months ended September 30, 2024.

These charges were primarily related to strategic operational improvements to increase net revenue and lower costs as well as a provision to accounts receivable related to our Fusion5 business which is in the process of being wound down.

We expect to incur material future costs relating to certain exit and realignment actions, which remain underway and we are not able to reasonably estimate.

The following table summarizes the activity related to exit and realignment cost accruals, which are generally classified as other current liabilities in our condensed consolidated balance sheets, through June 30, 2025 and 2024:

We do not expect to incur material future costs relating to certain exit and realignment actions, which remain underway.

Accrued exit and realignment costs, December 31, 2024

9 unchanged sentences

Accrued exit and realignment costs, June 30, 2025

Provision for exit and realignment activities:

Professional fees

IT strategic initiatives and other

Cash payments

Accrued exit and realignment costs, September 30, 2025

Accrued exit and realignment costs, December 31, 2023

9 unchanged sentences

Accrued exit and realignment costs, June 30, 2024

In addition to the exit and realignment accruals in the preceding table, we also incurred $ 0.4 million and $ 7.6 million of costs that were expensed as incurred for the three and six months ended June 30, 2025, which primarily related to wind-down costs of Fusion5.

Debt, net of unamortized deferred financing costs, as of June 30, 2025 and December 31, 2024 consisted of the following:

June 30, 2025

Provision for exit and realignment activities:

Professional fees

IT strategic initiatives and other

Cash payments

Accrued exit and realignment costs, September 30, 2024

In addition to the exit and realignment accruals in the preceding table, we also incurred $ 0.1 million and $ 7.7 million of costs that were expensed as incurred for the three and nine months ended September 30, 2025, which primarily related to wind-down costs of Fusion5.

Debt, net of unamortized deferred financing costs, as of September 30, 2025 and December 31, 2024 consisted of the following:

September 30, 2025

December 31, 2024

2 unchanged sentences

6.625 % Senior Notes, due April 2030

Less current maturities

Less current maturities, including anticipated repayments

Long-term debt

Agreement) in the Grantors’ present and future subsidiaries, subject to certain customary exceptions, and (b) all present and future personal property and assets of the Grantors, subject to certain exceptions.

On March 29, 2022, we entered into a Security Agreement Supplement pursuant to which the Security and Pledge Agreement (the Security Agreement), dated March 10, 2021 was supplemented to grant collateral on behalf of the holders of the 2024 Notes, and the parties secured under the credit agreements including first priority liens and security interests in (a) all present and future shares of capital stock owned by the Grantors (as defined in the Security Agreement) in the Grantors’ present and future subsidiaries, subject to certain customary exceptions, and (b) all present and future personal property and assets of the Grantors, subject to certain exceptions.

On March 29, 2022, we entered into a term loan credit agreement with an administrative agent and collateral agent and a syndicate of financial institutions, as lenders (the Credit Agreement) that provides for two credit facilities:

12 unchanged sentences

The Revolving Credit Agreement matures in March 2027.

At June 30, 2025 we had $ 135 million in outstanding borrowings on our Revolving Credit Agreement.

At September 30, 2025 we had $ 271 million in outstanding borrowings on our Revolving Credit Agreement.

At December 31, 2024 our Revolving Credit Agreement was undrawn.

At June 30, 2025 and December 31, 2024, we had letters of credit, which reduce Revolver availability, totaling $ 29 million and $ 31 million, leaving $ 286 million and $ 419 million available for borrowing.

At September 30, 2025 and December 31, 2024, we

had letters of credit, which reduce Revolver availability, totaling $ 29 million and $ 31 million, leaving $ 150 million and $ 419 million available for borrowing.

The Revolving Credit Agreement, the Credit Agreement, the 2029 Unsecured Notes and the 2030 Unsecured Notes contain cross-default provisions which could result in the acceleration of payments due in the event of default of any of the related agreements.

The terms of the applicable credit agreements also require us to maintain ratios for leverage and interest coverage, including on a pro forma basis in the event of an acquisition or divestiture.

We were in compliance with our debt covenants at June 30, 2025.

As of June 30, 2025, future principal payments due under our debt agreements or anticipated to be repaid within twelve months, excluding other, were as follows:

We were in compliance with our debt covenants at September 30, 2025.

As of September 30, 2025, future principal payments due under our debt agreements or anticipated to be repaid within twelve months, were as follows:

2025 (remainder)

Current maturities at June 30, 2025 includes $ 383 million in debt anticipated to be repaid within the next twelve months in connection with net cash proceeds expected to be received within the next twelve months related to the contemplated P&HS segment sale.

Current maturities at September 30, 2025 represent $ 280 million in debt anticipated to be repaid within the next twelve months in connection with expected net cash proceeds related to the Purchase Agreement.

Note 9—Share-Based Compensation

2 unchanged sentences

We use authorized and unissued common shares for grants of RSAs, SARs, PSAs or for stock option exercises.

At June 30, 2025, approximately 1.7 million common shares were available for issuance under the Plan.

At September 30, 2025, approximately 2.2 million common shares were available for issuance under the Plan.

We anticipate approximately 1.8 million unvested shares to be forfeited in connection with closing of the sale of the P&HS segment, which would increase the common shares available for issuance by this amount.

RSAs under the Plan generally vest over one , three or five years .

2 unchanged sentences

Under the 2023 Omnibus Incentive Plan, unless the individual award agreements provide otherwise, if the successor company assumes the awards, vesting of the award will be accelerated upon a subsequent termination of employment without cause or, if the teammate resigns for good reason, in each case, within 24 months following the change in control, with any performance-based awards deemed earned based on the target performance levels.

Share-based compensation expense for the three and six months ended June 30, 2025 was $ 5.0 million and $ 9.3 million with recognized tax benefits of $ 1.3 million and $ 2.4 million.

Share-based compensation expense for the three and six months ended June 30, 2024 was $ 4.3 million and $ 8.4 million with recognized tax benefits of $ 1.1 million and $ 2.2 million.

Unrecognized compensation cost related to nonvested RSAs, net of estimated forfeitures, was $ 32 million at June 30, 2025.

Share-based compensation (benefit) expense for the three and nine months ended September 30, 2025 was ($ 0.1 ) million and $ 9.2 million with recognized tax expense of less than $ 0.1 million and benefits of $ 2.4 million.

Share-based compensation expense for the three and nine months ended September 30, 2024 was $ 3.5 million and $ 12.0 million with recognized tax benefits of $ 0.9 million and $ 3.1 million.

For the three months ended September 30, 2025, we incurred a $ 4.0 million benefit for changes in expected performance achievement associated with our 2023, 2024, and 2025 PSAs.

Unrecognized compensation cost related to nonvested RSAs, net of estimated forfeitures, was $ 27 million at September 30, 2025.

This amount is expected to be recognized over a weighted-average period of 2.0 years, based on the maximum remaining vesting period required under the awards.

Unrecognized compensation cost related to nonvested PSAs as of June 30, 2025 was $ 12 million and will be recognized primarily in 2025, 2026, and 2027 if the related performance targets are met at the current level expected.

The following table summarizes the activity and value of nonvested RSAs and PSAs for the three and six months ended June 30, 2025 and 2024:

Unrecognized compensation cost related to nonvested PSAs as of September 30, 2025 was $ 4.3 million and will be recognized primarily in 2025, 2026, and 2027 if the related performance targets are met at the current level expected.

The following table summarizes the activity and value of nonvested RSAs and PSAs for the three and nine months ended September 30, 2025 and 2024:

Three Months Ended

September 30,

Grant-date Fair

2 unchanged sentences

Nonvested awards at end of period

Six Months Ended

Nine Months Ended

September 30,

Grant-date Fair

2 unchanged sentences

Nonvested awards at end of period

The total fair value of RSAs and PSAs vested during the three and six months ended June 30, 2025 was $ 8.1 million and $ 12 million.

The total fair value of RSAs and PSAs vested during the three and six months ended June 30, 2024 was $ 11 million and $ 17 million.

The total fair value of RSAs and PSAs vested during the three and nine months ended September 30, 2025 was $ 1.7 million and $ 14 million.

The total fair value of RSAs and PSAs vested during the three and nine months ended September 30, 2024 was $ 0.3 million and $ 17 million.

Note 10—Derivatives

10 unchanged sentences

We report cash flows from our hedging instruments in the same cash flow statement category as the hedged items.

The following table summarizes the terms and fair value of our outstanding cash flow hedges as of June 30, 2025:

The following table summarizes the terms and fair value of our outstanding cash flow hedges as of September 30, 2025:

Derivative Assets

17 unchanged sentences

Based on contractual terms, the notional amount will decrease in increments of $ 50 million on the last business day of March of each year until the maturity date.

The following table summarizes the effect of cash flow hedge accounting on our condensed consolidated statements of operations for the three and six months ended June 30, 2025:

Amount of Loss Recognized in Other Comprehensive Income (Loss)

The following table summarizes the effect of cash flow hedge accounting on our condensed consolidated statements of operations for the three and nine months ended September 30, 2025:

Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss)

Total Amount of Expense Line Items Presented in the Condensed Consolidated Statement of Operations in Which the Effects are Recorded

Amount of Gain Reclassified from Accumulated Other Comprehensive Loss into Net Loss

Three months ended June 30, 2025

Six months ended June 30, 2025

Three months ended September 30, 2025

Nine months ended September 30, 2025

Location of Gain Reclassified from Accumulated Other Comprehensive Loss into Income

Three months ended June 30, 2025

Six months ended June 30, 2025

Three months ended June 30, 2025

Six months ended June 30, 2025

Three months ended September 30, 2025

Nine months ended September 30, 2025

Three months ended September 30, 2025

Nine months ended September 30, 2025

Interest rate swaps

1 unchanged sentence

The amount of ineffectiveness associated with these contracts was immaterial for the period presented.

The following table summarizes the effect of cash flow hedge accounting on our condensed consolidated statements of operations for the three and six months ended June 30, 2024:

Amount of Gain Recognized in Other Comprehensive Income (Loss)

The following table summarizes the effect of cash flow hedge accounting on our condensed consolidated statements of operations for the three and nine months ended September 30, 2024:

Amount of (Loss) Gain Recognized in Other Comprehensive Income (Loss)

Total Amount of Expense Line Items Presented in the Condensed Consolidated Statement of Operations in Which the Effects are Recorded

Amount of Gain Reclassified from Accumulated Other Comprehensive Loss into Net Loss

Three months ended June 30, 2024

Six months ended June 30, 2024

Three months ended September 30, 2024

Nine months ended September 30, 2024

Location of Gain Reclassified from Accumulated Other Comprehensive Loss into Income

Three months ended June 30, 2024

Six months ended June 30, 2024

Three months ended June 30, 2024

Six months ended June 30, 2024

Three months ended September 30, 2024

Nine months ended September 30, 2024

Three months ended September 30, 2024

Nine months ended September 30, 2024

Interest rate swaps

2 unchanged sentences

Note 11—Income Taxes

The effective tax rate was 1.3 % and 3.0 % for the three and six months ended June 30, 2025, compared to 28.9 % and 30.1 % for the three and six months ended June 30, 2024.

The change in these rates were primarily from changes in results of operations, including the tax treatment associated with the $ 80 million transaction breakage fee for the three and six months ended June 30, 2025.

The liability for unrecognized tax benefits was $ 53 million and $ 36 million at June 30, 2025 and December 31, 2024.

The effective tax rate was ( 54.3 )% and 0.8 % for the three and nine months ended September 30, 2025, compared to ( 31.6 )% and 32.2 % for the three and nine months ended September 30, 2024.

The change in these rates were primarily from changes in results of continuing operations, including the tax treatment associated with the $ 80 million transaction breakage incurred during the nine months ended September 30, 2025, as well as the impact of certain discrete tax items relative to pre-tax (loss) income.

The liability for unrecognized tax benefits was $ 52 million and $ 36 million at September 30, 2025 and December 31, 2024.

Substantially all of the $ 16 million increase in the liability for unrecognized tax benefits was the result of the tax treatment associated with the $ 80 million Rotech transaction breakage fee.

Included in the liability at June 30, 2025 and December 31, 2024 were no tax positions for which ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.

Included in the liability at September 30, 2025 and December 31, 2024 were no tax positions for which ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.

On August 26, 2020, we received a Notice of Proposed Adjustment (NOPA) from the Internal Revenue Service (IRS) regarding our 2015 and 2016 consolidated income tax returns.

9 unchanged sentences

This matter does not impact our 2023, 2024 or future tax years.

As of June 30, 2025, we owed $ 37 million associated with the NOPA matter, which includes $ 10 million of interest accrued on the matter through June 30, 2025.

As of September 30, 2025, we owed $ 37 million associated with the NOPA matter, which includes $ 11 million of interest accrued on the matter through September 30, 2025.

The balance sheet classification and amount owed may be subject to change depending on the timing of a final agreement with the IRS.

3 unchanged sentences

The OBBB contains several changes to corporate taxation including modification to limitations on deductions for interest expense and accelerated fixed asset depreciation.

We are still assessing the impact to our consolidated financial statements.

Note 12—Net Loss per Common Share

The following summarizes the calculation of net loss per common share attributable to common shareholders for the three and six months ended June 30, 2025 and 2024:

We expect the legislation to decrease future U.S.

cash taxes with no material impact to the effective tax rate.

Note 12—Net (Loss) Income per Common Share

The following summarizes the calculation of net (loss) income per common share attributable to common shareholders for the three and nine months ended September 30, 2025 and 2024:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(in thousands, except per share data)

Loss from continuing operations, net of tax

(Loss) income from continuing operations, net of tax

Loss from discontinued operations, net of tax

( 1,044,316 )

Weighted average shares outstanding - basic

2 unchanged sentences

Basic loss per common share:

Loss from continuing operations, net of tax

(Loss) income from continuing operations, net of tax

Loss from discontinued operations, net of tax

Diluted loss per common share:

Loss from continuing operations, net of tax

(Loss) income from continuing operations, net of tax

Loss from discontinued operations, net of tax

Share-based awards for the three and six months ended June 30, 2025 of approximately 2.5 million and 2.2 million and 1.6 million shares for the three and six months ended June 30, 2024 were excluded from the calculation of diluted loss per common share as the effect would be anti-dilutive.

Share-based awards for the three and nine months ended September 30, 2025 of approximately 2.3 million and 2.2 million and 1.5 million shares for the nine months ended September 30, 2024 were excluded from the calculation of diluted loss per common share as the effect would be anti-dilutive.

In accordance with ASC 260, dilutive shares are included in computing the diluted loss per common share from discontinued operations, net of tax and net loss per diluted common share for the three months ended September 30, 2024 even though they were anti-dilutive, as the control number (income from continuing operations, net of tax) was in an income position.

Note 13—Shareholders Equity

On February 26, 2025, our Board of Directors authorized a share repurchase program of up to $ 100 million over the next 24 months .

On February 26, 2025, our Board of Directors authorized a share repurchase program of up to $ 100 million and expires February 2027.

Under the program, we may repurchase shares of common stock on a discretionary basis from time to time through open market repurchases, privately negotiated transactions and 10b5-1 trading plans.

During the three and six months ended June 30, 2025, we repurchased in open-market transactions and retired approximately 0.7 million and 0.8 million shares of our common stock for an aggregate of $ 5.1 million and $ 6.6 million, or an average price per share of $ 7.87 and $ 8.04 .

During the nine months ended September 30, 2025, we repurchased in open-market transactions and retired approximately 826 thousand shares of our common stock for an aggregate of $ 6.6 million, or an average price per share of $ 8.04 .

Note 14—Accumulated Other Comprehensive (Loss) Income

The following table shows the changes in accumulated other comprehensive (loss) income by component for the three and six months ended June 30, 2025 and 2024:

Accumulated other comprehensive (loss) income, March 31, 2025

The following table shows the changes in accumulated other comprehensive (loss) income by component for the three and nine months ended September 30, 2025 and 2024:

Accumulated other comprehensive (loss) income, June 30, 2025

Other comprehensive income (loss) before reclassifications

3 unchanged sentences

Other comprehensive income (loss)

Accumulated other comprehensive (loss) income, three months ended June 30, 2025

Accumulated other comprehensive (loss) income, March 31, 2024

Accumulated other comprehensive (loss) income, three months ended September 30, 2025

Accumulated other comprehensive (loss) income, June 30, 2024

Other comprehensive income (loss) before reclassifications

3 unchanged sentences

Other comprehensive income (loss)

Accumulated other comprehensive (loss) income, three months ended June 30, 2024

Accumulated other comprehensive (loss) income, three months ended September 30, 2024

Accumulated other comprehensive (loss) income, December 31, 2024

4 unchanged sentences

Other comprehensive income (loss)

Accumulated other comprehensive (loss) income, six months ended June 30, 2025

Accumulated other comprehensive (loss) income, nine months ended September 30, 2025

Accumulated other comprehensive (loss) income, December 31, 2023

Other comprehensive income (loss) before reclassifications

Other comprehensive income (loss) before reclassifications, net of tax

Other comprehensive income before reclassifications

Other comprehensive income before reclassifications, net of tax

Amounts reclassified from accumulated other comprehensive income (loss)

1 unchanged sentence

Other comprehensive income (loss)

Accumulated other comprehensive (loss) income, six months ended June 30, 2024

Accumulated other comprehensive (loss) income, nine months ended September 30, 2024

We include amounts reclassified out of accumulated other comprehensive (loss) income related to defined benefit pension plans as a component of net periodic pension cost recorded in Other expense, net.

1 unchanged sentence

On June 3, 2025, the Company, Rotech and Merger Sub mutually agreed to terminate the Merger Agreement and entered into the Termination Agreement.

In accordance with the terms of the Termination Agreement, the Company made a cash payment to Rotech of $ 80 million during the three and six months ended June 30, 2025.

In accordance with the terms of the Termination Agreement, the Company made a cash payment to Rotech of $ 80 million on June 5, 2025.

This payment fulfills the obligation as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.

Refer to our Annual Report on Form 10-K for the year ended December 31, 2024 for disclosure of other material contractual obligations.

We are party to various legal claims that are ordinary and incidental to our business, including ones related to commercial disputes, employment, workers’ compensation, product liability, regulatory and other matters.

We are party to various legal claims that are ordinary and incidental to our business, including ones related to commercial disputes, employment, personal injury, product liability, regulatory, workers’ compensation, and other matters.

We maintain insurance coverage for employment, product liability, workers’ compensation and other personal injury litigation matters, subject to policy limits, applicable deductibles and insurer solvency.

We establish reserves from time to time based upon periodic assessment of the potential outcomes of pending matters.

Based on current knowledge and the advice of counsel, we believe that the accrual as of June 30, 2025 for currently pending matters considered probable of loss, is sufficient.

Based on current knowledge and the advice of counsel, we believe that the accrual as of September 30, 2025 for currently pending matters considered probable of loss, is sufficient.

In addition, we believe that other currently pending matters are not reasonably possible to result in a material loss, as payment of the amounts claimed is remote, the claims are immaterial, individually and in the aggregate, or the claims are expected to be adequately covered by insurance, subject to policy limits, applicable deductibles, exclusions and insurer solvency.

Note 16—Segment Information

As described in Note 1, the P&HS segment has met the accounting requirements to be classified as discontinued operations and held for sale at June 30, 2025, and we no longer report the P&HS segment.

As described in Note 1, the P&HS segment has met the accounting requirements to be classified as discontinued operations and held for sale at September 30, 2025, and we no longer report the P&HS segment.

The P&HS segment was initially classified as discontinued operations and assets held for sale as of June 30, 2025.

Our President, Chief Executive Officer & Director is the chief operating decision maker (CODM).

15 unchanged sentences

We expect this ASU to only impact our disclosures with no impacts to our results of operations, financial condition and cash flows .

In July 2025, the FASB issued ASU 2025-05, Financial Instruments – Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides a practical expedient permitting the

assumption that conditions at the balance sheet date remain unchanged over the life of the asset when estimating expected credit losses for current accounts receivable and current contract assets.

The amendments in this ASU are effective for us in annual and interim periods beginning after December 15, 2025.

We do not expect this ASU to have a material impact on our consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software, which will require capitalization of software costs when management has authorized and committed to funding software projects and it is probable that the project will be completed and the software will be used to perform the function intended.

The amendments in this ASU are effective for us in annual periods beginning after December 15, 2027.

The amendments in this ASU are required to be applied on a prospective basis and retrospective adoption is permitted.

We are currently evaluating the effects of adopting this guidance on our consolidated financial statements.

Note 18—Subsequent Events

We will retain a 5 % equity interest in the P&HS segment.

The Purchaser will be required to pay us a termination fee under certain specified circumstances of $ 9.4 million or $ 19 million depending on the stage of regulatory approval and other criteria.

The sale is subject to customary closing conditions, including the Hart Scott Rodino Act and other regulatory approvals, and is expected to close in the first quarter of 2026.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements